Wine of the Times – Retail for the

WINE WITH THE TIMES:

Making Wine More Accessible to Australia’s Youth

Words Cody Profaca

The Natural-Wine movement has proved a major success in the youth market

Wine is a complex drink with arguably more culture and history than any other alcoholic beverage. As a result, it is one of the most widely available forms of alcohol on the market, and yet remains relatively inaccessible to newer consumers. This is due to the perception that one requires a certain level of product knowledge before they can properly buy wine with confidence, something that has traditionally alienated younger buyers.

Despite this, a privately conducted survey studying the purchasing habits of youth across Sydney found that 30% usually drink wine over other forms of alcohol, and 52% consume wine at least one in five times they drink. Similarly, a Business Insider report found that 42% of the wine drunk in the USA was by young people. These statistics are at odds with a survey of Sydney bottleshops, however, which found that young people are buying wine less than 15% of the time.

These statistics suggest that young people are generally drinking wine at home with their families instead of socially with friends. Even though they are already drinking and enjoying wine they are typically not purchasing the bottles themselves.

Matthew Oosthuizen, a 22 year old bottle-shop worker who has been in the industry since 2018, gives his opinion as to why this might be.

“Probably the main barrier is the wine labels. They’re not very appealing and there’s not a lot of information on the drop on the back of the label which I think stems from them believing that it’s their reputation selling wine. This might be true for wine drinkers but it’s a bit of a deterrent if you’re new to the whole thing.”

The following graph reflects youth buyer sentiment when purchasing different forms of alcohol at liquor stores.

Matthew Oosthuizen, 22, has worked in the industry since 2018

Consumer Confidence in Purchasing Decision (<25 y.o.)

What Can Be Done to Make Wine More Accessible to Young People

30% 28% 2%

31%

56% 49% 40%

11% 2% beer/cider/mixed drinks 18%

5%

Spirits 26%

Wine

Very Unclear Not very clear Fairly Clear Very Clear

The above graph confirms that youth are often unsure about what they are purchasing when it comes to wine. The fact that they readily drink wine when it is available and yet struggle to purchase it in a liquor store suggests that a change in sales techniques and marketing could result in significantly more wine being sold.

Why would bottle-shops want to sell more wine to young people? Wine sales generally draw more repeat customers compared to other drinks due to an increased reliance on staff assistance. Wine also has significantly higher profit margins than other categories of alcohol.

The following graph displays a comparison of what Sydney’s youth and Sydney’s bottle-shops think are the most important factors in making wine more accessible to young people.

This below graph is interesting for several reasons. Firstly, there is a high correlation between the youth survey and the bottleshop survey, reflecting that liquor retailers understand what their youth customers require.

Secondly, the largest deviation occurs because Sydney’s youth want more access to product information in store, further emphasizing the lack of consumer confidence when purchasing wine.

The only other major deviation occurs in Targeted advertising/social media, with bottle-shops ranking it as more important. This is unsurprising as effective advertising typically goes unnoticed by the consumer, and the fact it still ranked highly among Sydney’s youth reflects its importance.

The last interesting point to note is the even spread across the categories. To make wine more accessible to young people numerous changes should be made in a variety of areas.

So what can wine-retailers do to better accommodate Australia’s youth?

One simple way is to help younger buyers better understand the product they are purchasing. This can be done by displaying short product descriptions/pamphlets that inform about the wine, through more effective customer service, or even through in-store tastings. Matthew Oosthuizen explains the need for information to be shared in a straight-forward, non-pretentious manner.

“I think there’s a culture among young people of not wanting to ask, so I guess that would put it on the staff to be more open and friendly about it, talking about it, and letting them ask for wines they could recommend without being judged.”

The next major step is to target wine

30.00%

25.00%

20.00%

15.00%

10.00%

5.00%

0.00%

Be�er product descrip�ons/customer service

Unique wine styles/grape varie�es More exci�ng/less serious labels Cheaper prices Targeted adver�sing/social media

Alternate product formats (eg half bo�les, cans) Reduc�on in s�gma

Youth Survey Bo�le Shop Survey

Johnathan Hepner is the owner of Bucket Boys Marrickville

advertisements towards youth. With this, it is important to recognize what aspects of wine appeal most to younger generations and using this to focus media campaigns. Johnathan Hepner, owner of Bucket Boys Bottle-Shop Marrickville, recognizes that younger wine drinkers are looking for different things in the bottles they buy when compared to traditional wine buyers.

“I think one of the main things that’s driving younger wine drinkers is the idea of drinking fresh wines, so not having to store things in the cellar and worry about vintages and dates, it’s more like: this is what it tastes like and it’s meant to drink now.”

Advertisements that focus on the fun factor and uniqueness of wines will likely appeal most to Australia’s youth. This could be focusing on natural wines, petnat’s or even some of the more unique and interesting grape varieties found in the traditional wine sector. For example, Australian Grenache with its bright red berry flavours is a very approachable style to the novice wine drinker, or the red-fleshed Saperavi could provide a unique drinking experience to get someone new to the world of wine hooked.

Alternative product formats, and especially canned wine, also have a strong potential to increase wine’s appeal. With the removal of the need for glassware and the convenience of having wine in the size of a single serve, it becomes far more accessible for those who aren’t planning on sharing a bottle with mates. It also removes a lot of the traditions surrounding wine, which can often be a deterrent to those just starting out on their wine journey.

The appearance of wine is also essential to reducing its stigma. Johnathan Hepner believes that when it comes to younger drinkers “the cloudier and uglier it looks in the bottle the better.”

He also feels younger generations would prefer to drink an interesting, unique, and decent-quality wine over a traditional, mainstream and high-quality wine.

“It doesn’t mean the wine is any less interesting or good or bad, it just means people have caught onto the fact that just putting your name on a white label and a vintage date is not the best way to sell wine, especially to this demographic.”

Johnathan also believes the story and ethos of the producer makes a big difference.

“We try to focus on independent wines, we try to focus on innovative stuff so natural ferments, minimal contact wine-making, and also along those same lines choosing younger wine makers who kind of have an idea about the branding and marketing that appeals to younger wine drinkers.”

One important point to note, however, is

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Canned wine is fun, accessible and convenient

that a strong focus on appealing to younger generations has the potential to alienate traditional wine buyers.

“I have lots of friends who are big wine drinkers who don’t shop here much because they don’t like natural wine. They want a straight varietal, they want to know where it comes from, they’re interested more in the aspects that most people were forever: where was it grown, who grows it, was it a good year or was it a bad year, all the things young wine drinkers just don’t care about.”

With Bucket Boys being a small store, balancing traditional and natural wines is a harder process due to limited shelfspace. With a larger store, clear segregation between the traditional and the natural wine sections could pose as an effective solution. This would not only maintain buyerconfidence among traditional wine buyers, but would create a fun and exciting section to entice new wine drinkers.

Despite this, demographic is also an important aspect to consider. While Bucket Boys is located in the youth-centric Inner West, Tom Mazzei of Toms Cellars West Pymble on Sydney’s North Shore is not looking to expand his range of natural wines.

“Pet-nats seem to be a category for the younger demographic and I would say our stores are located in a more established mature market, and because of that we haven’t had the demand for these styles of wine.”

When it comes to stocking both traditional wines and natural wines in store, Johnathan says there is a bit more that has to be considered.

“Some of my friends have caught on to the fact that just because it’s natural wine doesn’t mean it’s funky, I think a lot of winemakers could do a better job of segmenting if it’s going to be funky versus clean: that would really help.”

The future of wine in younger generations is promising: young people are already drinking and enjoying wine at home but are disenfranchised by stigma and various traditions. With increasingly accessible and more exciting formats of wine appearing on the market, it seems natural that in the future wine-drinking will be adopted at increasingly younger ages, something that will only benefit the industry as a whole.

Tom Mazzei is the owner of Toms Cellars West Pymble

MARKETING SHOPPERS OUT OF COVID TOWARDS 2022 AND BEYOND

AUSTRALIAN LIQUOR MARKETERS GENERAL MANAGER OF MARKETING, JOSH GAUDRY EXPLAINS HOW HIS BUSINESS IS EFFECTIVELY MANAGING THE PANDEMIC MARKETING RESPONSE TO LEVERAGE RETAIL MOMENTUM.

What has been your approach to marketing over the unstable Covid period of the last 18 months for retail?

My covid work story won’t be one I will forget soon. I joined the business on the first day of Covid lockdown in March 2020. No one knew what was ahead of us. Without a playbook to refer to, I jumped onto the roller coaster ride and did the only thing I could do, buckle up and let my instincts guide our marketing strategy for the unforeseeable future. Instincts in this case were referring to the foundational liquor landscape research ALM conducted just before Covid hitting, and I spent time wrapping my head around the intricacies of the business. The response to the million questions I had while everyone was trying to stay on top of the ups and downs of what was happening around us was truly overwhelming. Everyone in ALM across the country was so forthcoming with their time and information; it made the task an absolute pleasure.

A credit to many things we did at ALM, we stuck to our guns on much of our strategic initiatives. To do this, we also had to be agile and ready to pivot should the need demand. From a marketing perspective, we very much had to walk and chew gum simultaneously. While we were busy putting a long term strategy together, we had to keep the lights on with the day to day business. It is true that retail moves faster than the world of FMCG, but the speed of operations during Covid 2020 was staggering. We maintained and kept up with the pace through consistent, collaborative communication between our states, functions, and our most important key stakeholders – the retailers themselves.

And for long term brand building?

IBA has a spectacular portfolio of uniquely differentiated banner offerings. In my first week, I remember I got very direct advice from our National Retail Board to showcase that differentiation. The key to our current and ongoing strategy is to develop a long and short marketing strategy. In all the good marketing textbooks that have ever been written, having a solid short term tactical marketing strategy and plan is critical for driving foot traffic to stores. Our retailers live and die by our ability to drive the short term plan. It is the foundation of what we do. The long term brand building plan is about creating brand meaning, bringing brand positioning to life through differentiated and uniquely distinctive propositions. It’s a harder sell because the benefits aren’t always immediate, but it is vital for long term brand sustainability. It’s a bit like golf. You can’t be good at putting if you don’t have a good drive, and vice versa; it is no point having a long game if you can’t convert those short term putts.

How will this new marketing approach benefit your retail partners?

In the craziness of the Covid years, it has not been easy to pull apart sales data and attribute it to one thing that succeeded or failed. The quantitative ad diagnostics, however, point to a very positive outlook. We knew we needed to get the basics of our short term plan bedded down and clearly articulated with a long foresight of what was coming. Achieving this bought us a bit of trust from our business and our retailers to execute against a long and short strategy. Endorsement from our NRB and State Committees have been a key enabler of achieving alignment across the network on the strategy. We (the marketing team) service our retailers. They entrust us to market their brand, and our job is simple; make people aware of us, make people like us and get people to turn up to their stores and fill their baskets. We never lose sight of that, and it drives everything we do.

Tell us about the catchy Bottle-O TV commercial reception and what was behind its creative development?

Our brand positioning informs everything we do from a marketing perspective. It’s marketing jumbo to many, but it is our North Star; it guides everything. For this reason, The Bottle-O commercial (and our Cellarbrations TV commercials) all started with our brand positioning. Once again, research and what shoppers want from a liquor retail experience informs our brand

positioning. The Bottle-O is the everyman/ woman who doesn’t take himself too seriously, is loveable, outgoing and thinks fun is the ultimate leveller. That’s what the TVC brings to life. It’s light-hearted, it champions the retailer and the brand, and it just reinforces the idea we don’t take everything too seriously. Easy to say, but hard to do. We worked with our brilliant ad agency Dig to develop the campaign, and I must say developing and shooting during a pandemic threw all sorts of challenges at us. I’m proud of the spot, but most importantly, shoppers like it too. It has performed well above industry benchmarks for awareness (people remember it) and appeal (people like it and see the intention).

How does this approach grow awareness and appeal of the IBA brands?

The key to our strategy is to bring our brands to life. An enormous driver of retail liquor is top of mind awareness. Consumers need to know who we are, what we stand for whenever they want to buy booze. Awareness is one of those things that is easier to move the needle on; you pour more media dollars onto it. That’s not always practical or possible, so you have to make sure what you do appeals to shoppers. High appeal makes up for the shortfalls of any budget challenge. It is super hard to nail, but when you do, it is gold dust! They work in tandem, but no amount of money in media will grow your brand without appeal. Appeal has the greatest correlation to the things that matter most – loyalty, frequency and spend. It’s that simple, if you like a brand, you tend to be more loyal to it. If you like a brand, you visit it more often and spend more on it. We relentlessly focus on these two metrics, and we measure them in research periodically. We know it’s a long term game, but we have built the foundations, and we already see the benefits of the strategy.

What are your greatest challenges right now?

The greatest challenges are probably our greatest opportunities. Changing consumer behaviour is probably one of the toughest jobs to do in marketing. It takes a dambuster moment for consumers to change what they do. Covid has been our dambuster moment. We have capitalised on this time to re-organise our marketing strategy, put some foundations in place for the short and long term and orientate our business behind relentlessly delivering against it. Shoppers have re-appraised our brands or appraised them for the first time and like what we are doing. Of course, this is our total offering, but marketing plays a crucial role in driving that re-appraisal. The challenge now is to continue to live up to expectations, continue to deliver and engage with consumers in a meaningful way. That’s tough, but it drives us.

How do you see the business continuing to navigate these unprecedented times in the next twelve months?

A trusted partner once told me this line, and I have it written on a post-it note above my desk – “Think big, start small, execute relentlessly”. I remind myself of this often, and it has serviced me well in the first tumultuous 18 months, and I am sure it will get me through the next twelve.